Support Available for Business and Self Employed during the Corona Outbreak

We have set out below the measures that have been put into place by the Government on the 20th March to help Employers and Businesses cope with the Corona Virus.

If you are worried about anything then please do not hesitate to contact us for help or support.

The Chancellor has set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19.

This includes a package of measures to support businesses including:

a Coronavirus Job Retention Scheme

deferring VAT and Income Tax payments

a Statutory Sick Pay relief package for SMEs

a 12-month business rates holiday for all retail, hospitality and leisure businesses in England

small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief

grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000

the Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank

the HMRC Time To Pay Scheme

Additional support for the Self Employed

Coronavirus Job Retention Scheme:

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.

You will need to:

designate affected employees as ‘furloughed workers,’ and notify your employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation

submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)

HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.

Deferring VAT and Income Tax Payments:

For VAT there will be a 3 month deferral of payment from 20 March until 30 June. There will be an automatic allowance for no VAT payments to be made during this period. If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021. No penalties and interest for late payments will be charged in the deferral period.

Time to Pay:

HMRC have also scaled up their Time to Pay offer to all firms and individuals who are in temporary financial distress as a result of Covid-19 and have outstanding tax liabilities.

All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.

If you have missed a tax payment or you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline: 0800 0159 559.

Support for Businesses who are paying Sick Pay to Employees:

HMRC will allow small-and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. The refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19. A rebate scheme is being developed for employers to access this scheme. Further details will be provided in due course once the legalisation has passed.

Business rates:

Support for businesses that pay little or no business rates

The government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

You are eligible if:

your business is based in England

you are a small business and already receive SBBR and/or RRR

you are a business that occupies property

You do not need to do anything. Your local authority will write to you if you are eligible for this grant.

Cash grants for retail, hospitality and leisure businesses

The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.

For businesses in these sectors with a rateable value of under £15,000, they will receive a grant of £10,000.

For businesses in these sectors with a rateable value of between £15,001 and £51,000, they will receive a grant of £25,000.

You are eligible for the grant if:

your business is based in England

your business is in the retail, hospitality and/or leisure sector

Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:

as shops, restaurants, cafes, drinking establishments, cinemas and live music venues

for assembly and leisure

as hotels, guest and boarding premises and self-catering accommodation

You do not need to do anything to access the scheme. Your local authority will write to you if you are eligible for this grant.

Business rates holiday for retail, hospitality and leisure businesses

The Government will introduce a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year.

Businesses that received the retail discount in the 2019 to 2020 tax year will be re-billed by their local authority as soon as possible.

You are eligible for the business rates holiday if:

your business is based in England

your business is in the retail, hospitality and/or leisure sector

Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:

as shops, restaurants, cafes, drinking establishments, cinemas and live music venues

for assembly and leisure

as hotels, guest & boarding premises and self-catering accommodation

There is no action for you to access the scheme. This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill automatically to exclude the business rate charge. They will do this as soon as possible.

Business Interruption Loan Scheme

A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch early next week to support primarily small and medium-sized businesses to access bank lending and overdrafts.

The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value.

Businesses can access the first 12 months of that finance interest free, as government will cover the first 12 months of interest payments.

You are eligible for the scheme if:

your business is UK based, with turnover of no more than £45 million per year

your business meets the other British Business Bank eligibility criteria

The full rules of the Scheme and the list of accredited lenders is available on the British Business Bank website. All the major banks will offer the Scheme once it has launched. There are 40 accredited providers in all.

You should talk to your bank or finance provider as soon as possible and discuss your business plan with them. This will help your finance provider to act quickly once the Scheme has launched. If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow.

The scheme will be available from early next week commencing 23 March.

Further Support for Self Employed:

Self Employed individuals will gain some help through the deferral of self assessment tax, payment holidays for mortgage payers and the strengthening of the welfare system.

If you are worried about a drop in income you should contact the universal credit helpline as soon as possible to find out if you are eligible and when you might be able to obtain assistance. Find out more here https://www.gov.uk/universal-credit

Mortgage lenders will be offering all of those struggling to pay with a three month mortgage holiday. Get in touch with your mortgage provider for more details.